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Bond X matures in two years, pays a coupon rate of 4%, and has a ytm of 4.25%. Bond Y matures in two years, pays

Bond X matures in two years, pays a coupon rate of 4%, and has a ytm of 4.25%. Bond Y matures in two years, pays a coupon rate of 5%, and has a ytm of 4.35%. Both bonds are free of default risk. Currently the yield curve is

a. downward sloping

b. flat

c. upward sloping

d. None of the above

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